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Remember, your unhappiness is Wall Street's most coveted asset. Don't humor them, and protect yourself. Base your performance evaluation efforts on goal achievement — yours, not theirs. Here's how, based on the three basic objectives of the income portfolio: Growth of base income, profit production from trading, and overall growth in working capital.

Closed end fund positions may be slightly higher than 5 percent, depending on the type — and beware of managed distribution programs. Take a reasonable profit (more than one years' income or 10 percent for starters) as soon as possible.

Coupled with a media that thrives on sensationalizing anything outrageously positive or negative, it becomes difficult to stay the course with any plan, as environmental conditions change. First greed, then fear, new products replacing old, and always the promise of something better when, in fact, the boring and old fashioned basic investment principles still get the job done.

Remember, your unhappiness is Wall Street's most coveted asset. Don't humor them, and protect yourself. Base your performance evaluation efforts on goal achievement — yours, not theirs. Here's how, based on the three basic objectives of the income portfolio: growth of base income, profit production from trading and overall growth in working capital.

Base income includes the dividends and interest produced by your portfolio, without the realized capital gains that may actually be the larger number much of the time. No matter how you slice it, your long-range comfort demands regularly increasing income, and by using your total portfolio cost basis as the benchmark, it's easy to determine where to invest your accumulating cash.

Since a portion of every dollar added to the portfolio is reallocated to income production, you are assured of increasing the total annually. If market value is used for this analysis, you could be pouring too much money into a falling stock market to the detriment of your long-range income objectives.

Profit production is the happy face of the market value volatility that is a natural attribute of all securities. To realize a profit, you must be able to sell the securities that most investment strategists (and accountants) want you to marry up with. Successful investors learn to sell the ones they love, and the more frequently (yes, short term), the better.
This is called trading, and it is not a four-letter word. When you can get yourself to the point where you think of the securities you own as high quality inventory on the shelves of your personal portfolio boutique, you have arrived. You won't see Wal-Mart holding out for higher prices than their standard markup, and neither should you.

Over time, you'll learn to beam with pride — for two reasons — as your diversified group of high-quality income earners moves lower in price with higher interest rates on the horizon. Finally, you'll realize, it's time to increase portfolio yield and reduce cost basis — at the very same time.

The second reason? Well that's the realization of how brilliant you were to have taken profits when interest rates were moving downward.

Growth in working capital (or portfolio cost basis) just happens — at a rate that will be somewhere between the average return on income securities and the total realized gain on your equities. But trading profits are not guaranteed and the risk of loss on equities is always greater than it is with income securities.

Asset allocations generally move from a greater to a lesser equity percentage as retirement approaches.

So is there really such a thing as an income portfolio that needs to be managed? Or are we really just dealing with an investment portfolio that needs its asset allocation tweaked occasionally as we approach the time in life when it has to provide the yacht — and the gas money to run it?

By using working capital as the number that needs growing, by accepting trading as an acceptable, even conservative, approach to portfolio management, and by focusing on growing income instead of ego, this whole retirement investing thing becomes significantly less scary.

Now you can focus on changing the tax code, reducing health care costs, saving Social Security and spoiling the grandchildren.